About Me

Friday, November 25, 2011

Glad to be back from illness, and in one piece (sort of). I spent a great deal of time flat on my back -- no comments please, just don't go there -- and all too many said that if that was the case, things were at least... looking up.

The lack of physical activity did lend itself to a great deal of thinking, prompted by the various and sundry debt crises affecting the world. Each situation has its little idiosyncrasies, but the more I pondered, the more I perceived a common thread: money had lurched towards being an end rather than a means.

This matters.

I have learned through running a successful business (love those sugar beets) that money must be tightly tied to production, whether of goods or services. In this sense money acts as a medium to facilitate said goods or services. Put bluntly, it has no other value. In fact, the inherent cost of an American dollar, a Chinese yuan or a Euro, is minimal. That we give it a much higher inherent value is an act of faith that rivals anything promulgated by the Vatican or exhorted in a mosque.

As long as this bond (money) between the maker or deliverer of a good or a service and the buyer of same exists, things work well. Yes, there are strictures that come into play, such as the law of supply and demand, the necessity of being competitive, or, as Kenny Rogers might put it, "Knowing when to hold em, and knowing when to fold em."

Moreover, when a new approach beckons, credit might be necessary. Fine, that is what banks are for, but for that credit, there must be collateral. Pawn shops are past masters at this, actually holding the collateralized article for a given period of time. If the approach turns out to be successful, the article is redeemed; if not, bye bye pawned article.

Recently, however, American and European banks saw an opportunity to make money from money. They took the collateralized item (mortgage, land purchase, whatever) wrapped it up in some reasonable investment items, and sold them on to interested buyers who sensed enormous profits. All of which raises the dandruffy head of Signor Ponzi. When a number of the investors, worried about how the bond market was reacting to all this, actually wanted their money back, it simply wasn't there. Money had ceased to be a medium between producer and buyer, and become an end in itself, disappearing into the pockets of what is now termed "the one per cent".

The way out of this mess will be hard. The concept of money must return to its roots as a facilitation medium, and quickly. This will mean a great deal of harsh austerity -- step forward Greece, whose country 'collateral' is nowhere near what the country presently earns -- and very few other countries will be able to avoid fiscal pain.

And what lurks in the background? Well, Clinton advisor James Carville put it this way: "I used to think that if there was reincarnation I wanted to come back as the President or the Pope. But now I want to be the bond market; you can terrify anybody."

Turns out that various 'feelers' had been put out by Haqqani personnel requesting a meeting. I was cited as the one with whom they wished to discuss 'things'. Apparently they knew of my close relationships with certain wives of world leaders, and mentioned Michelle O. and Hillary C. in particular. Moreover, they were interested in meeting the person who had almost got Bin Laden in Tora Bora, and since then had been a massive thorn in Al Qaeda's side.

I had to admit the request was an intriguing one, and when I learned that Sir Harry guaranteed a safe meeting, and that I could bring two associates, I accepted.

The meeting occurred somewhere in Northern Europe, and I cannot divulge more with respect to place. Sir Harry loaned Sir Peter Crapp of MI6, a person that was as skilled (almost) in the dark arts as I was. As for myself, I brought along Irving, who was fluent in Arabic, and Matilda Hatt, who had a good working knowledge of Pushtun and Dari. They had other attributes as well, should things take a nasty turn.

I was surprised that we met with only two men -- the Chief of the Haqqani Network, Maulvi, and his son, Sirajuddin. Maulvi began speaking in Russian, something that indicated he had done his homework, and knew that I was comfortable in that language. The fact that he himself was fluent was in all likelihood based on the fact that he had fought the Russians tooth and nail at the time when Russians had delusions of running Afghanistan. It helps to know an opponent's language.

I wore my hair long and uncovered, as well as a nice blouse and jacket and an Armani pencil skirt. My point? Haqqanis, you're a long way from some poor Burka-clad minion that would be putty in your hands. Deal with it.

A trade was being offered. The Americans use of drones was, in Maulvi's words, disrupting business, and stopping such attacks would be a Good Thing. I countered that stopping suicide bombings would also be a Good Thing, as well as cutting all ties with Al Qaeda.

"You ask too much," said Maulvi flatly.

"Ah, but hear me out," I continued. "What if your network suddenly went all legitimate?"

"What do you mean?"

"Well, as I understand it, among other Network activities, you offer, for a price, 'protection'. Now in the West, we call that insurance. Just think, your Network could offer such protection to ALL Afghans. They would pay a reasonable and affordable rate; the wide coverage would triple what you're bringing in now, and your new firm could serve as a model of legitimacy. Think of it as The Great East Life Assurance Company. Goodness, you could bring forth an IPO, even, in time, a listing on the NYSE."

Maulvi turned to his son. "What is the infidel bitch talking about? ' This was in Dari, and Tilly whispered the translation in my ear. Sirijuddin had obviously spent some time in the West, and had a handle on insurance. After their short interchange, Maulvi leaned forward. "People would cheat. They would lie. They would want more money to replace things than what they were originally worth. How could this be prevented?"

So I told him how, and the Haqqani's became familiar with the keystone of all such companies -- the insurance claims adjuster. They also agreed in principle to the deal, and gave me the go ahead to approach my conduits.

Who knows, the whole thing might come to pass. Yes, it's thinking outside the box, but never was such thinking more necessary. In this regard, I remember hearing the testimony at the Senate hearing concerned with the deadly fire that engulfed a NASA space capsule, killing two astronauts. One of the Senators asked, "How? How could such a terrible tragedy occur? Was there a failure?"

"Oh, yes," replied the NASA astronaut under oath. "There was a failure."

Thursday, November 3, 2011

Well, not an ode exactly -- I will leave that sort of thing to John Keats -- but the following little quatrain by Clarence Day struck a chord:

When eras die their legaciesAre left to strange police;Professors in New EnglandGuard the glory that was Greece.

The key word here I believe is "WAS".

Now every so often I get a chance to simply mull something over, aided and abetted by a serious martini. In this case, my thoughts turned to Greece, and the "glory" that is now in serious decline. I offer these thoughts in the hope of making a very murky situation a bit clearer.

Not that Greece crashed overnight. It has, I daresay, been some time since the Greeks left mathematics, governance and architecture and went into the restaurant business. Notwithstanding this excellent culinary contribution, there has been a slow decline from the age of Pericles, Euripides, Sophocles et al. More recently, this decline began to hit warp speed as spending began to outrageously outstrip revenue, bringing Greece to the brink of bankruptcy.

And as Greece is now ensconced in the European Union, and has forsaken the Drachma for the Euro, the country cannot inflate their way out of the mess.

This would not matter overmuch if there were truly a United States of Europe, where Greece comprises an estimated 2%--3 % of European Gross National Product. The other "states" could easily make up the difference. In the United States, for instance, Alabama or Georgia could get into fiscal trouble, and a national solution would be called for. Europe, however, is a long way from such unity.

What exacerbates this situation is the interlocking of European bank holdings and bonds. Even the Americans are looking askance; their own banks and investment houses are more than a little exposed. The solution is seen in the form of a massive bailout, contingent upon stringent austerity demanded of, as George Bush called them, "the Grecians". All of this has produced a welter of hand wringing at meetings, involving much weeping and flossing of teeth. And when Greece appeared to offer its citizens a referendum on the looming austerity measures, the fear on European faces was palpable. (The referendum has since been rescinded.)

I do believe the situation will right itself. Scared politicians can act, if the scare is big enough. If they don't, well it is a Greek, Nikos Kazantzakis, who sums the situation up well in his brilliant Zorba The Greek. In the movie made from the novel, the Englishman, played by Alan Bates, asks;

"Zorba, do you think the log-moving mechanism will actually work?"

Anthony Quinn, playing Zorba, replies, "Dunno, Boss. It will either work....or be a catastrophe."